CAPITOL HILL Saipan — With the cost of fuel continuing to rise the Northern Mariana Islands started exploring the possibility of working on an agreement with the Guam Power Authority to allow the Commonwealth Utilities Corp. to share its fuel storage facility.
Absalon V. Waki Jr. representative from Saipan told the 25th general assembly of the Association of Pacific Island Legislatures that NMI Lt. Gov. Timothy P. Villagomez started initiating talks with GPA officials regarding the proposal.
“The lieutenant governor is working closely with GPA officials to see if they can work on an agreement ” Waki told the Journal in an interview.
Waki noted however that transportation remains a problem. He said “How to transport the fuel from Guam to Saipan is still an issue. But they’re looking at all options.”
Joanne M.S. Brown senator in the 28th Guam Legislature who is also APIL president told the Journal that the NMI’s proposal is “very possible.”
“The islands should work on the specifics of that ” she said.
Villagomez said the local government is looking into every possible way to reduce CUC’s fuel expenses.
These he said include building a fuel tank farm scouting for cheaper fuel vendors and privatizing the CUC.
The administration moved to put CUC back in shape to attract potential investors as part of privatization plans. It sponsored legislation which is now on the governor’s desk for signing that would write off CUC’s debt to the Commonwealth Development Authority estimated to be more than $100 million including a $45-million principal. The administration sponsored another legislation that would allow the government to borrow up to $40 million from the Northern Mariana Islands Retirement Fund to upgrade CUC’s engines and facilities. Business groups and government retirees vigorously oppose both measures.
CUC procures up to three million gallons of diesel from Mobil Oil every month at a cost of about $6.5 million according to Anthony C. Guerrero acting executive director of utilities in a May interview with the Journal. (See the story “Northern Marianas looks over the hedge and sees fuel tanks” in the May 15 edition of the Journal.)
Guerrero said that a request for proposal involving the construction of up to four aboveground fuel storage tanks with an individual capacity of a million gallons each will be issued in the coming weeks. He said CUC’s current fuel storage capacity at its Lower Base main facility on Saipan is around two million gallons.
Guerrero said the NMI’s limited storage facility has made it costlier to procure fuel as tanker deliveries are done only every 22 days.
The annual APIL event held on Saipan from June 5 to 7 was meant to enable the association’s 12 members to draw up a common plan of action for economic development. MBJ